USD/CAD to amble in a 1.30-1.35 range into end-2020 – Westpac

The loonie is likely to amble in a 1.30-1.35 range into year’s end, according to economists at Westpac. 2021 will be likely a more auspicious year for CAD as vaccines are deployed and global recovery lifts up pace.

Key quotes

“Canada has not covered itself in glory lately. The recent Fitch downgrade underscores rising fiscal risks, while PM Trudeau and his government have been wounded by a government contract ethics scandal.”

“High frequency alternative data show the pace of rebound has lost some of its zest and the BoC remains among the more aggressive central banks, the Bank’s balance sheet growth approaching +20% of GDP since March 2020, well ahead of G10 peers.”

“USD/CAD likely to amble in a 1.30-1.35 range into the year's end. 2021 likely to be a more propitious year for CAD, as vaccines are deployed and global recovery picks up pace.”